No Vote before Deadline; Nation is Going Over The ‘Fiscal Cliff’

Originally published: December 31, 2012Updated: December 29, 2014 at 11:10 amBy Zachary Reis

New York — President Obama said Monday that an agreement to avoid the worst effects of the year-end fiscal cliff was “within sight,” but he stressed that a deal is “not done yet”. House Republican leaders announced they would hold no votes Monday night, virtually ensuring that the nation would go over the “fiscal cliff” for at least a day.

The President earlier in the day said he was “hopeful that Congress can get it done. But it’s not done.”

House Republicans notified lawmakers that the chamber will vote Monday evening on other bills. They say that will be their only votes of the day.

Both men said they were still bargaining over whether – and how – to avoid $109 billion in cuts to defense and domestic programs that take effect on Wednesday.

Tax increases will kick in automatically at the start of 2013 as a slew of temporary tax cuts—including the big income tax reductions first passed during the administration of President George W. Bush expire.

Obama is pushing for the Bush tax cuts to be extended only on income up to $250,000 per married couple (and up to $200,000 for single taxpayers), while Republicans have insisted that all the Bush tax cuts be preserved.

During recent negotiations with House Speaker John Boehner (R-Ohio) aimed at cutting a comprehensive deficit reduction deal, Obama had tentatively agreed to extend the tax cuts for income up to $400,000, while Boehner had tentatively offered to allow the tax rate to rise on income above $1 million—a position conservatives in his own caucus later rejected.

It remained unclear whether the Senate would vote Monday.

Congress could pass later legislation retroactively blocking the tax hikes and spending cuts but no schedule has been provided.

For a family making median income, they’ll notice an additional $3,500 dollar income tax increase. 27 million Americans will be subject to the alternative minimum tax, and additionally, the death tax will increase to 55 percent for estates of $1 million and over.